AMD took bigger slice of x86 server market in Q3

High-value chip focus pays off?

AMD saw its processor market share rise to its highest level in almost three years during Q3, market watcher IDC said this week.

The chip maker took 9.9 per cent of the revenue the x86 processor industry took from customers during Q3, up from 8.5 per cent in Q2, with its average processor price rising ten per cent quarter on quarter.

It's also shipping more CPUs than before - but that it's doing so is almost entirely down to its server products. Its share of the x86 server market grew from 6.9 per cent in Q2 to eight per cent in Q3, IDC said. However, its share of both the desktop and the notebook chip markets rose by less than a single percentage point in each case, to 18.4 per cent and 9.3 per cent, respectively.

Between Q2 and Q3, Intel's share of the number of x86 processors shipped fell by half a percentage point, from 81.7 per cent to 81.2 per cent.

AMD's shift under CEO Hector Ruiz, to focus less on winning big chunks of the market from its arch-rival and more on building a firmer financial footing through higher-value products, does appear to be working, IDC's figures show.

That's not to say the company can't grow its share of the number of processors shipped, but that's inevitably a much harder goal to achieve and certainly one made easier to do so if AMD can show that, as a company, it's much more financially stable. And that means driving revenue and earnings.

AMD worldwide sale chief Henri Richard told Reuters last month that the company will come out of 2005 "a significant player in the enterprise segment".

"I see no reason why we couldn't capture a third of the server market," he said.

He will have to work hard during the coming year. Opteron's share of the x86 server market, even in Q3, is well below AMD's overall server share of eight per cent - there are still a lot of low-priced Athlon MP-based boxes shipping - and Opteron is now up against EM64T-enabled Intel Xeon processors, of course. ®